Bombril filed on Monday, 10, in conjunction with other societies of its economic group, request for judicial recovery before the 1st Regional Business Court and conflicts related to the arbitration of the 1st Judicial Administrative Region of São Paulo. The request was authorized on this same date by the company’s board of directors.
“This measure is being taken, in the best interest of the company, to organize, in an organized manner, a comprehensive negotiation procedure with all interested parties to adapt its indebtedness structure,” explains Bombril in a relevant fact released recently.
The request for judicial recovery occurs about two years after the company deny this possibility, when it had to resort to a credit rights transmission of R $ 300 million, lighting the yellow sign of the market at the time.
With the judicial recovery filed, the company states that “it will be able” to maintain its operational capacity and properly restructure its liabilities, through a “swift process” and the “smaller impact” possible to the rights of creditors and operational activities .
Such a measure, according to the administration, “is in line” with the management efforts of Bombril’s liabilities, which have been made in recent years, and the recovery of the profitability of its activities, which has ensured, in recent quarters, the obtaining of positive accounting results.
“The company trusts that, through judicial recovery, it will be possible to achieve a healthy indebtedness structure that will allow a new growth cycle and new investments, for the benefit of the stakeholder collectivity,” concludes Bombril.
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Legal liabilities
Bombril has relevant tax contingencies, especially those related to federal revenue assessments for alleged lack of collection of taxes on foreign debt securities (T-Bills), between 1998 and 2001 by the Company and by vehicle of Italian Group Cragnotti & Partners, which was Bombril’s controller at that time.
Such assessments are discussed in legal proceedings and involve the total aggregate amount of approximately R $ 2.3 billion. Given the relevance and the high value involved, the administration reported that “constantly monitors” the progress of lawsuits. In this sense, due to an unfavorable decision rendered recently in court proceedings, the directors of Bombril gathered today to deliberate on the situation.
At the meeting, the board reevaluated the chances of loss in court proceedings and alternatives to deal with this issue and their impacts, supported by opinions of external advisors.
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It also considered that the current risk of loss in legal proceedings is “threat” to good accounting results that have been obtained by Bombril, exposing the company to “high risks”, related to the reevaluation of its ability to comply by suppliers and funders. and, to the limit, to the discontinuity of certain trade relations and early salary of debt.
As a result of this reevaluation, the Administration deliberated by the accounting recognition of the values discussed in the court proceedings, determining the adoption of appropriate measures.
